Daimler seeks €1bn in savings at Mercedes-Benz by cutting jobs
INTERNATIONAL - Tougher emissions rules will hit Daimler’s profits in 2020 and 2021, prompting the German carmaker to seek more than 1 billion euros ($1.1 billion) in savings from cutting staff costs at its Mercedes-Benz business by the end of 2022, it said on Thursday.
Daimler shares were down 2.3 percent in early trading at 52.17 euros, the biggest decline on Germany's DAX .GDAXI blue-chip index, which was down 0.3 percent.
Management positions will be cut by around 10 percent, and company said it would also seek more than 300 million euros from cutting personnel costs - plus another 250 million euros in fixed costs - at its trucks business.
Daimler said it needed to sell more electric vehicles to meet tougher European Union rules which force carmakers to cut carbon dioxide emissions from cars by 37.5 percent by 2030 compared with 2021 levels, and following a 40 percent cut between 2007 and 2021.
The company said it expected to achieve a return on sales from operating activities at Mercedes-Benz Cars & Vans of at least 4 percent in 2020 and at least 6 percent in 2022.
Mercedes-Benz expects car sales to grow by around 3 percent in 2020, but said potential trade tariffs and Brexit could depress the return on sales by up to 1 percent.
Earlier this year, Daimler had said it hoped to achieve a return on sales of 3 percent to 5 percent at Mercedes-Benz Cars.Reuters